• World

Low Gas Prices Are Stalling the Green-Car Revolution

4 minute read

Just under a decade ago, America seemed on the cusp of an auto revolution. Faced with a slumping economy and skyrocketing oil prices, drivers were turning away from costly, gas-guzzling SUVs–think of the Hummer brand that General Motors killed in 2010–and toward hybrid-electric cars that promised, over time, to save them millions at the pump. The technology was poised to go mainstream, thanks in part to a freshly elected President Obama, who promised to make it cheaper to produce greener cars–which in turn would make it cheaper to buy them.

That was then. In recent years, as the economy recovered and gas prices dropped, so has demand for more-fuel-efficient cars. Electric and hybrids now make up less than 3% of new-car purchases, down from years past. Roughly 75% of Americans who traded in a hybrid or electric car this year took home an all-gas car, an 11-point spike from 2015, according to Edmunds car data. And all of this is happening during a period when people are driving their cars more than ever. For a week in June, U.S. drivers consumed more than 9.8 million barrels of gas every day, eclipsing a record set in 2007.

There’s more at stake here than which type of vehicles Americans prefer. Fuel emissions account for more than 16% of total U.S. greenhouse-gas emissions, making the car you drive–and the choice to drive at all–the single greatest variable affecting your carbon footprint. Put simply: the more gas America guzzles, the more it’s warming the climate.

At the same time, it’s unreasonable to expect drivers to change their habits purely because of an altruistic sense of duty. The numbers have to add up too. And right now, they don’t. Buying a Toyota Camry hybrid, for example, would save its owner about $400 annually in gas spending (vs. a similar-size all-gas vehicle). But it would also cost an extra $3,000 up front. For many Americans, that payoff isn’t worth the investment.

Automakers face the same dilemma. “As a chief economist at a large auto company, I tend to be fond of low oil prices,” joked GM’s Mustafa Mohatarem at an energy conference this summer, referring to the fact that people tend to buy more cars when gas prices drop. And if consumers want gas-powered vehicles, there’s less incentive for automakers to spend hundreds of millions of dollars developing better, sleeker hybrid-electric options.

So who breaks this stalemate? The government, for starters. Thanks to a set of regulations implemented during Obama’s first term, automakers are required to keep improving their average fuel efficiencies to a certain degree, no matter how oil prices might fluctuate. That’s largely why the Ford 150, America’s top-selling pickup, now gets 26 m.p.g., up from 20 in 2008, and many consumers opt for more-carlike crossover SUVs. A recent report from the Environmental Protection Agency and other agencies suggests regulators won’t be easing those standards, despite some automakers’ insistence that they no longer make sense. “They are what they are,” says Bob Lee, who runs the electrified-propulsion division at Fiat Chrysler, which announced on July 27 that it was shifting U.S. production to focus on building more trucks and SUVs. “We need to meet them.”

But igniting a true green-car revolution–the kind Obama hinted at in 2008–will require more than fuel-efficiency standards. One solution, favored by some economists and environmental activists, is an increase in the gas tax, which hasn’t been raised since 1993. Others have suggested taxing carbon emissions, so people will rethink how they drive. In Norway, where drivers pay both fees, the signature car from Elon Musk’s Tesla Motors has enjoyed a brief period as the country’s top-selling vehicle. Stateside, however, it’s hard to imagine getting either measure through a gridlocked Congress (to say nothing of the public backlash).

Indeed, the most plausible approach may well be to create the impossible: an electric car that actually offers more value than its gas-powered competitor. Many are trying, from Tesla to GM, which is releasing an inexpensive all-electric this year. The future of driving is “not going to be determined by gas prices,” says economist Jeff Sachs, head of Columbia University’s Earth Institute. “It’s going to be determined by technology.”

For more on these ideas, visit time.com/ideas

More Must-Reads From TIME

Write to Justin Worland at justin.worland@time.com